The House Specific Buyers
This week I showed favorite buyers a house that was definitely “Buyer Specific”, and the people I showed it to may well have been the specific buyers – perhaps the only ones in Washington - for whom the house would be perfect. So, that’s a good thing, right?
First, let me describe the place. At an asking price of about $1.5 million, it is a mid-century bi-level on a busy street, has a sort of plain brown wrapper façade and has two bedrooms. At least one of these factors would not work for your typical buyer.
So what does work? While it’s on a busy street, the house is set back, and the lot is large and nicely landscaped. It was fabulously renovated, with an amazing kitchen and baths (even nicer than what I’m putting into my house). The rooms are generous in size and sun-filled, and there’s a maintenance free back garden with a very private stone patio. The house also has a lot of storage space
So my guys are almost empty nesters. They don’t need eight bedrooms. They view the plain-ish façade as a good thing. It just wouldn’t look that appealing to burglars – no one would suspect that the interior and back of the house were totally fabulous – who would likely move on to one of the neighbors’ truly grand looking residences. They are serious cooks who will use and appreciate the kitchen – like, if I had a kitchen like this one Iwould cook! And they are the types who would live on the back patio, except for winter and August.
We were talking about the pros and cons of their buying the place, and the inevitable question came up, “Do you think this house is a good investment?”
This home is likely to be their “forever” house. They’ll be able to live there until they’re ready for assisted living, which is likely to be several decades down the road. So the long term nature of the investment will work in their favor. But when they do go to sell it, there will likely be a smaller pool of buyers, meaning that while it will have appreciated, it could increase in value less than a cliché house that would have wider appeal.
I compared the investment component to that of my flute. I bought it back in the ‘70s, when gold was at about $700 an ounce, and a lot of its value was in the metal. One of my advisors was a Wall Street investment banker who is also a very good amateur flutist with a large instrument collection, and I took it to New York for him to look at. My wood piccolo and my silver flutes had all gone up in value, and while this flute sounded amazing and was really fun to play, he pointed out to me that it wasn’t likely to appreciate, and might lose value if the price of gold went way down.
While the flute flunked the investment test, I bought it anyway. It’s held its value, but it hasn’t really appreciated much. Much more important to me, however, these many years later, it still sounds amazing when I play it, and even though I’m a little out of shape, I can manage to sound like a Julius Baker student and friend’s weddings and housewarming parties. It’s something that has given me hours of joy, and I can’t imagine my life without it.
So, my buyers are mulling!